Startup mentors discuss strategies and challenges of creating a new business.

Rebuild the Airplane in Mid-Air

GUEST MENTOR Eric Kuhn, founder and CEO of FoundersCard: It was spring 2000 and the company that I had founded a few years earlier, VarsityBooks, had recently gone public. It was supposed to be a time of celebration and continued growth for our business. But as every entrepreneur knows all too well, things don’t usually work out as planned. Wall Street was rapidly souring on business-to-consumer Internet companies in a big way. We had only several months of cash left and I sensed we needed to do something big, not merely incremental.

Within weeks, I presented a plan to our board to change the business from selling discounted textbooks to college students to becoming an outsourced bookstore-solutions provider for private high schools and small colleges. The new plan would allow us to significantly cut marketing costs and increase margins.

We rallied the team around the new mission and set out to build a new market with the same passion and energy as we had when we launchedour original idea. It was the toughest period I faced as CEO. Each day required challenging decisions, from appropriately staffing the company, to negotiating out of long-term commitments, all while meeting our obligations as a public company.

A few years later, we surpassed revenue from the old model. We were growing profitably and regained listing on the NASDAQ.

Many of today’s startups are too willing to keep something going that is not going to work in the future. There’s a fine line between loyalty to an idea and stubborn unwillingness to changing course. If you’re gutsy enough to take the chance to start a business, you’ve got to be equally willing to take the chance that it won’t make it and that something else might. Don’t keep an idea on life support because you’re too stubborn to face reality. This can and will shoot you in the foot.

In the end, sometimes changing course profoundly is the only sane option.

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For aspiring or actual entrepreneurs, The Accelerators forum is a lively discussion among startup mentors– entrepreneurs, angel investors and venture capitalists. To reach us: @wsjstartup or theaccelerators@wsj.com.